The molecular mechanism of FGF10 signaling in the pancreas is not understood. FGF10 controls pancreatic epithelial cell division as well as differentiation. In absence of FGF10 (fgflO -/- mice), the pancreas fails to form and is arrested at the early budding stage. In the presence of increased levels of FGF10 (pPDX10-FGF10FLAG mice) the pancreatic epithelium maintains an increased level of proliferation, and becomes arrested in an undifferentiated state. The latter effect can be attributed to increased levels of Notch signaling. We found that Jaggedl and Jagged2, Notch ligands, previously uncharacterized in the developing pancreas, may account for this. This mechanism precedes the later involvement of Notch in selection of pancreatic terminal fates. In this proposal we will address the mechanistic basis of FGFlO-signaling in pancreatic development, and investigate how this signaling mechanism may control downstream target genes. We have identified the Ets-protein family as a plausible target for FGF10 phosphorylation, and through an evaluation of all members of this family by several exclusion criteria, we have found that the Etv-subfamily is involved in FGF10 signaling. We will here characterize the role of select members of the Etv-subfamily in pancreatic cell differentiation and during pancreatic progenitor cell expansion. We will also address these as targets of FGFlO-induced MARK phosphorylation and as regulators of FGF10 target gene expression in pancreatic progenitors. To do this, we will perform in-vitro, and in-vivo assays of gene function, including transgenic and targeted mutation strategies. This work is important in relation to the generation of a cell replacement source for Diabetes.